Methodist Healthcare System on Saturday closed on the purchase from MedCath Corp. and a group of about 70 physician investors. The transaction was valued at about $78.5 million, plus some working capital.

On Monday, the hospital was renamed Methodist Texsan Hospital to reflect the new ownership and the plans to add other acute-care services.

“Our thinking is to add other surgical services, in addition to heart, like orthopedic surgery and some additional general surgery modalities,” said Jaime Wesolowski, Methodist Healthcare's president and chief executive.

Business Channel

Nike to Investigate Workplace Behavior, Announces President will ResignWibbitz

Robots Break New Ground in Construction IndustryAssociated Press

Passengers Travelling With Small Child Taken Off Southwest Flight From Chicago to AtlantaStoryful

Lyft Testing Netflix-Like Subscription Packages for RidersWibbitz

Cats Ride Robotic Stuffed CrabJukin Media

Is This the End of Candy Hearts? America's 'Oldest' Candy Company Could CloseVeuer

ESports Continues To Intrigue InvestorsWochit

Is This the End of Candy Hearts? America's 'Oldest' Candy Company Could CloseBuzz 60

Texsan has room to grow. Though it has 120 beds, only about half have been regularly utilized, Wesolowski said.

“It's a competitive environment with all the (hospital) systems in town,” Wesolowski said. “They started at 60 beds and added an additional 60 beds. They just weren't able to get enough traction to fill those beds.”

Methodist Healthcare has had some capacity constraints at the other eight area hospitals it operates, Wesolowski said.

Related Stories

“We have been working on spending capital on virtually every one of our facilities,” he said. “Even with those expansions ... we just desperately need additional beds.”

Texsan, at 6700 Interstate 10 West, opened in 2004 and features four operating rooms, four cardiac catheterization labs and an emergency department. It employs about 300 people, all of whom will be retained by Methodist Healthcare.

Texsan reported $76 million in net patient revenue and about $67 million in expenses in 2008, figures from the state show. More than 60 percent of its revenue came from Medicare. Figures from 2009 were not immediately available.

MedCath, meanwhile, has lost nearly $100 million combined in its last two fiscal years after posting a $21 million profit in 2008.

In March, MedCath announced it would sell either the company or its assets. Texsan marks MedCath's fifth completed transaction since the announcement.

Edwin French, MedCath's president and CEO, did not respond to a request for comment.

Craig Desmond, who has served as Texsan's chief executive and will remain in the role, could not comment for MedCath but said he believed the company had been exploring its options even before the passage of health care reform in February.

Still, he acknowledged the Patient Protection and Affordable Care Act restricts the growth of physician-owned hospitals.

“There's no doubt it's going to put pressure on physician-owned hospitals in the future,” Desmond said. Texsan will not face those restrictions under Methodist Healthcare.

Charlotte, N.C.-based MedCath expects to receive $58 million from the transaction after closing costs, taxes, the acquisition of the minority interests in the hospital partnership and other expenses.